U.S. stock markets showed a mixed performance as investors digested the latest Federal Reserve policy decision. The Dow Jones Industrial Average edged higher, while the S&P 500 and Nasdaq both fluctuated, reflecting uncertainty about the next moves from central bankers.

The Federal Reserve opted to leave its key interest rate unchanged for the fifth consecutive meeting, maintaining the federal funds rate range at 4.25% to 4.5%. This move signals a continued cautious approach from policymakers, who are balancing ongoing inflation pressures with a still-solid labor market. According to the Federal Open Market Committee, recent data point to moderated economic growth in the first half of the year, while unemployment remains low and labor market conditions are stable.

All eyes were on Federal Reserve Chair Jerome Powell, who addressed the press after the meeting. Powell underscored that the central bank had made “no decisions” regarding a potential rate cut at the upcoming September meeting, emphasizing a wait-and-see stance as officials monitor evolving economic conditions. While markets had speculated about the possibility of another rate cut later this year, Powell’s remarks suggested a desire for more data before taking action.

Despite some divisions within the Fed and external pressure, the policy decision was supported by a majority of committee members. The hold on rates comes after three cuts at the end of 2024, as the Fed now pauses to assess the impact of its earlier moves.

Investors are left to parse these signals as they position for the remainder of the year. The mixed market reaction reflects a high degree of uncertainty regarding inflation, growth, and the central bank’s next steps. Going forward, key data releases—particularly on employment and inflation—will likely dictate both Fed policy and market sentiment.